Anti-gobalization: The left's violent assault on global prosperity
By Edwin A. Locke
web posted January 20, 2003
The World Economic Forum starting this week in the Swiss city
of Davos will see a conglomeration of left-wing and
environmentalist protestors who will be united by a single
emotion: a virulent hatred of capitalism, especially global
capitalism. Why the hatred?
The advantage of a global economy based on free trade and
capitalism is so obvious and so enormous that it is difficult to
conceive of anyone opposing it. The benefit is based on the law
of comparative advantage: every country becomes more
prosperous the more it invests in producing and exporting what it
does best (in terms of quality, cost, uniqueness, etc.), and
importing goods and services that other countries can produce
more efficiently. For example, let us say that Nigerian companies
can produce T-shirts for $1 a piece whereas U.S. companies
can only produce them for $5 a piece. Under free trade,
Americans will buy their T-shirts from Nigeria. This division of
labor benefits people in both countries. Nigerians will have more
money to buy food, clothing and housing. Americans will spend
less on T-shirts and have more money to buy cell phones and
SUVs, and the investment capital formerly spent on T-shirts will
be put to more productive uses, say in the area of technology or
drug research. Multiply this by millions of products and hundreds
of countries and over time the benefits run into the trillions of
dollars.
How, then, do we reconcile the incredible benefits of global
capitalism with the anti-globalization movement? The protestors
make three claims repeatedly. First, they argue that multinational
corporations are becoming too powerful and threaten the
sovereignty of smaller nations. This is absurd on the face of it.
Governments have the power of physical coercion (the gun);
corporations do not; they have only the dollar -- they function
through voluntary trade.
Second, anti-globalists claim that multinational companies exploit
workers in poor countries by paying lower wages than they
would pay in their home countries. Well, what is the alternative?
It is: no wages! The comparative advantage of poorer countries
is precisely that their wages are low, thus reducing the costs of
production. If multinational corporations had to pay the same
wages as in their home countries, they would not bother to invest
in poorer countries at all and millions of people would lose their
livelihoods.
Third, it is claimed that multinational corporations destroy the
environments of smaller, poorer countries. Note that if 19th-
century America had been subjected to the environmental
legislation that now pervades most Western countries, we
ourselves would still be a third-world country. Most of the
industries that made the United States a world economic power
-- the steel, automobile, chemicals and electrical industries --
would never have been able to develop. By what right do we
deprive poor, destitute people in other countries from trying to
create prosperity in the same way that we did, which is the only
way possible?
All of these objections to global capitalism are just
rationalizations. The giveaway, and the clue to the real motive of
today's left and their hangers-on, is that all their protests are
against -- they are anti-capitalism, anti-free trade, anti-using the
environment for man's benefit -- but they are not for anything. In
the first third of the 20th century, most leftists were idealists --
they stood for and fought for an imagined, industrialized utopia --
Communism (or Socialism). The left's vision was man as a
selfless slave of the state, and the state as the omniscient
manager of the economy. However, instead of prosperity,
happiness and freedom, Communism and Socialism produced
nothing but poverty, misery and terror (witness Soviet Russia,
North Korea and Cuba, among others). Their system had to fail,
because it was based on a lie. You cannot create freedom and
happiness by destroying individual rights; and you cannot create
prosperity by negating the mind and evading the laws of
economics.
Furious over the fact that their envisioned utopia has collapsed in
ruins, the leftists now seek only destruction. They want to
annihilate the system that has produced the very prosperity,
happiness and freedom that their system could not produce. That
system is capitalism, the system of true social justice where
people are free to produce and keep what they earn.
The fact that free trade is now becoming truly global is one of the
most important achievements in the history of mankind. If, in the
end, it wins out over statism, global capitalism will bring about
the greatest degree of prosperity and the greatest period of
peaceful cooperation in world history.
We should scornfully ignore the nihilist protestors -- they have
nothing positive to offer. We should not only allow global
capitalism; we should welcome it and foster it in every way
possible. It is time to rephrase Karl Marx: Workers of the world
unite for global capitalism; you have nothing to lose but your
poverty.
Edwin A. Locke, a Professor Emeritus of management at the
University of Maryland at College Park, is a senior writer for the
Ayn Rand Institute (www.aynrand.org/medialink) in Irvine, Calif.
The Institute promotes Objectivism, the philosophy of Ayn
Rand, author of Atlas Shrugged and The Fountainhead. Send
comments to reaction@aynrand.org.
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